State Govts Rely On External Sources For 16% Health Budgets — NGF Report

Posted by African Examiner Featured, Latest Headlines, News Across Nigeria Monday, January 13th, 2025

(AFRICAN EXAMINER) – The Nigeria Governors’ Forum’s health sector expenditure and institutional review report showed that 36 states depend on external funding for 16 per cent of their health budgets.

The state-level report obtained on Monday noted that “State governments depend on 16% of their health budgets from external sources, including aid, grants, and loans. Grant and international aid programmes were the primary sources of non-discretionary capital funding for most States, with less than a quarter of them seeking loan options to finance their capital projects in the sector,” the report said.

The reports attributed the low uptake to limitations in securing loans or disinterest in pursuing the above financing options.

Total health expenditure by the 36 States of the federation was N505 billion in 2022 – at 7% of their total spending – up from N484 billion in 2021.

In 2023, the 36 States budgeted N923.31 billion for the sector, an increase of 83% from the total actual expenditure in 2022. The report notes that budget performance for the sector averages around 63% year-on-year, indicating that the actual spending for 2023 may fall well below the N923.31 billion target.

The average health spending of State governments is N14 billion annually, with wide variations from state to state.

According to the report, only 15 states had a medium-term health sector strategy (MTSS) covering at least the 2024 budget year.

Evidence showed that there were other cases of alternative planning documents and frameworks used internally by the health ministries to guide resource allocation for the sector.

Some of these alternative tools, the report said provide a prescription of the activities, outputs, and outcomes similar to what is attainable in the MTSS, although driven at the health ministry level.

In terms of healthcare prioritisation, the report said 61.83% of the aggregate health budget of the 36 states from 2021-2023 was allocated to public health services and health administration, leaving 38.17% for hospital services (26.17%), outpatient services (10.5%), medical products appliances and equipment (1.22%), and health research and development (0.28%).

“States’ inability to present their health expenditure by specific services (e.g. primary care, secondary and tertiary healthcare programmes) and disease categories (e.g., infectious diseases, non-communicable diseases, maternal and child health) is because the National Chart of Accounts (NCOA) was developed based on the global standard Classification of Functions of Government (COFOG) which did not provide these classifications of health spending. Full implementation of the programme segment of the NCOA will help rectify this issue in future years,” the report added.